Section 83(b) Election: Form 15620 General Instructions 2025

 

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Section 83(b) Election Form 15620: A Complete Guide to Making the Election

Form 15620, titled "Section 83(b) Election," allows individuals who receive substantially nonvested property in connection with the performance of services to elect to include the property's fair market value in their gross income at the time of transfer, rather than when it becomes substantially vested. This election can be advantageous if the property is expected to appreciate in value, as it allows taxpayers to pay taxes on the property's value at the time of transfer, potentially at a lower rate.

This guide provides a comprehensive overview of Form 15620, including:

•  for completing the form, detailing each box and the information required.
•  illustrating how to calculate the fair market value and the amount to include in gross income.
•  for ensuring the election is timely and correctly filed.
•  on where to file the form and the importance of retaining proof of filing.
•  on the irrevocable nature of the election and the implications of making it.

Whether you're an employee, independent contractor, or tax professional, this guide will help you understand and navigate the Section 83(b) election process.